Yahoo Finance Warner Bros. Discovery CEO says company has 'full buffet' of sports as NBA rights decision looms
Warner Bros. Discovery (WBD) CEO David Zaslav is leaning on the company's other sports assets as it remains at risk of losing a key media rights deal with the National Basketball Association (NBA).
"We continue to talk to the NBA," Zaslav said while speaking at a Bernstein conference on Thursday. "We love our experience with the NBA. But in general, we're a leader in sports... [with] a full buffet of content around the world."
The executive touted the company's Olympics coverage win in Europe, along with the recent additions of NHL games, Nascar races and college football in the US.
"This is what we do for a living," he said. "We're in the business of sport, and in sport, the deals come up [and] you make a decision about the overall quality of the full menu of content you have for each of your platforms."
The NBA's current contract with Warner Bros.' TNT Network and Disney's ESPN (DIS) expires at the end of next season, and rumors have swirled in recent weeks that WBD could lose the media rights to its portion of games to Comcast's NBCUniversal (CMCSA). Amazon (AMZN) is also in talks for an exclusive streaming deal through its Prime Video service.
Wall Street analysts have said that possibility would have lasting consequences for the embattled media giant.
"Losing NBA rights would be a big negative for WBD," Macquarie analyst Tim Nollen said in a note published earlier this month. "While the cost savings may help earnings, we think sports content is key both for linear TV ad sales and carriage fees, and for the Max streaming service's prospects in a competitive direct-to-consumer landscape, especially as it prepares to join the sports streaming [joint venture] with Disney and Fox."
Sports rights have become increasingly important for legacy media players as more consumers cut the cord. The content is viewed as "sticky," meaning loyal audiences are more willing to fork over their monthly cable package or streaming service fee to access sports over many other types of content.
But the field has become more competitive, with tech giants like Amazon, Apple (AAPL), and YouTube (GOOG, GOOGL) committing more heavily to sports streaming deals over the past year. That's inflated the overall costs of sports as traditional media giants struggle to keep up.
Warner Bros. currently shells out a reported $1.2 billion annually for the NBA rights. Disney, the NBA's other major broadcast partner, has agreed to increase its payment of $1.5 billion a year to $2.6 billion in order to renew its deal, according to the Wall Street Journal.
A separate report from the Sports Business Journal suggests Disney's total pay package is closer to $2.8 billion. Amazon's deal is said to be worth between $1.8 billion and $2 billion.
Notably, WBD has the ability to match third-party offers before the NBA enters into any agreements.
Last week, NBA commissioner Adam Silver briefly addressed the negotiations, telling TMZ: "We’re all still talking. Who knows how it’s going to work out?”
Alexandra Canal is a Senior Reporter at Yahoo Finance. Follow her on X @allie_canal, LinkedIn, and email her at alexandra.canal@yahoofinance.com.
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